- EV sales in North America grew 20% year-to-date, thanks to an influx of Chinese EVs in Mexico and Tesla’s rivals stepping up in the U.S.
- China’s embrace of EVs reached new heights. The country accounted for 1.4 million of the 2.4 million EVs and PHEVs sold globally in the first two months of 2025.
- It’s unclear how long EV sales will continue to grow in the U.S., with the Trump administration’s tariff threats and the potential end of tax credits.
Despite the uncertainties around tariffs and the potential end to the federal clean vehicle credits, the uptake of electric vehicles has continued to grow in the U.S. so far this year. According to market intelligence firm Rho Motion, the U.S. saw a 28% growth in EV sales in the first two months of this year. That includes both fully electric vehicles and plug-in hybrids. With Tesla sales tanking worldwide and quite possibly even in the U.S., where is the growth stemming from?
Tesla’s rivals are now grabbing a bigger share of the market with an influx of new, high-tech and relatively affordable EVs. Tesla will release its Q1 2025 sales numbers in early April. But they’re expected to fall, in line with global trends. They cratered in several global markets so far this year. In February alone, Tesla’s China-made sales dropped almost 50% and there was a sweeping decline in most European markets, including Germany, Sweden, France, Spain and Italy.
Photo by: Honda
While General Motors has been eating into Tesla’s market share over the past few quarters, it only releases its sales numbers on a quarterly basis. But Ford, Hyundai, Kia and Honda release monthly figures and they have all reported growth in EV sales. Ford EVs were up 15% year-over-year in February. American Honda sold nearly 3,000 Prologues and 1,500 Acura ZDXs last month. Hyundai and Kia’s hot streak continued with the Ioniq 5, Ioniq 6 and EV9 witnessing year-over-year gains. And the Volkswagen ID.4 was the third best-selling EV in the U.S. in January after the Tesla Model Y and Model 3.
Whether this momentum will continue or stall is an open question. The Trump administration has started taking steps to roll back the federal clean vehicle credit and has threatened to impose a 25% tariff on imports from Mexico, where many of the above mentioned EVs are manufactured. It may take weeks, or even months for the restrictive policies to materialize. So, it seems like EV buyers are taking advantage of the incentives as long as they exist, including the incredible lease and financing offers currently available.
Plus, we saw a lot of over-supply on the EV front last year, which means automakers were offering even more aggressive deals on leftover 2024 models into the beginning of this year. That may have driven some of these sales surges which, as those inventories clear out, may die down. Volkswagen, for instance, had a multi-month stop-sale of the ID.4, which just ended in January. The company got aggressive about clearing out existing cars in the aftermath.
But it’s not like these numbers are an anomaly. Globally, EVs are gaining strong momentum as well. The report adds that global EV and PHEV sales were up 30% in the Jan-Feb period, reaching 2.4 million units. China is driving much of this surge, accounting for a whopping 1.4 million units. BEVs grabbed the lion’s share of China’s EV sales, with 46% growth while PHEVs grew 22%. The European Union and the U.K. are also embracing EVs, with fully electric models growing 29% and PHEVs growing marginally at 2%. Europe’s love affair with small, affordable EVs has started to take off and it’s delivering results. Let’s hope that happens here.
Have a tip? Contact the author: [email protected]
